Denied Extension, Verizon Asks to Delete Calif. Deadline to Move Tracfone Users
Verizon renewed a request for leeway to migrate many California Tracfone customers despite getting rejected last month by the California Public Utilities Commission’s executive director. Taking a fresh procedural tack, Verizon petitioned Thursday to modify the CPUC’s 2021 Verizon/Tracfone conditional OK to remove a two-year deadline and eliminate penalties (docket A.20-11-001). The carrier pledged to keep serving unmigrated customers “for an indefinite time period that will last at least through 2025.”
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CPUC Executive Director Rachel Peterson last month denied Verizon’s June 2 request for a one-year extension of a Nov. 22 deadline to migrate Tracfone customers still using non-Verizon networks (see 2307130054). Peterson said Verizon’s incomplete request failed to show good cause for the extension. Consumer advocates say the CPUC shouldn’t waive penalties for failing to move more than 170,000 customers on non-Verizon networks in two years.
Verizon’s petition asks the state commission to delete the order's two-year customer migration deadline “to ease the burdens on our customers.” The CPUC should also remove the penalty schedule, since it would become moot if the deadline is lifted, said the carrier. Verizon said it will keep trying to convince customers to migrate. And the carrier will continue to meet other merger order requirements, "including, without limitation, offering free phones and/or SIM cards to TracFone customers who require a compatible phone and/or SIM card to migrate to the Verizon network,” it said. Also, Verizon said it will keep up its migration hotline and continue filing tier-one advice letters to update the CPUC quarterly.
Thursday's petition to remove the two-year deadline is worse than Verizon’s June 2 request for a one-year extension, emailed Center for Accessible Technology Legal Counsel Paul Goodman. “The customer migration issues were central to the merger proceeding, and eliminating the conditions that protect not yet migrated customers would result in, potentially, tens of thousands of [California] LifeLine customers losing their only telephone service.” The CPUC’s five commissioners didn’t have to vote on Verizon’s earlier request, but procedurally they would have to vote on the petition -- though not by any certain date, said Goodman.
“The merger requirements are in place to protect consumers, and these fines associated with the protections help secure robust compliance,” said The Utility Reform Network Lead Telecom Counsel Brenda Villanueva. “Verizon appears to recommend changes to create a path to end the service provided to Tracfone customers on third-party networks,” while avoiding fines, she said. “Tracfone customers will be the ones most impacted if customer migration does not occur promptly. For many, maintaining their phone service is critical to reaching support services and other vital communications.”
The proposed modification would benefit and not harm customers, argued Verizon’s petition. Customers could “make a decision that works best for them based on their preferred schedule, without an arbitrary deadline, while being protected from service termination without notice or out of pocket migrations costs,” said the carrier: If the carrier does stop providing service to customers on non-Verizon networks after 2025, it will notify customers at least 60 days, 30 days and 7 days before it happens. Verizon said it has “strong financial incentive” to persuade customers to migrate and not lose them.
The two-year deadline could "confuse or annoy customers who are happy with the service they have and likely unaware of the network used to provide it,” Verizon said. "In the prepaid context, TracFone does not possess an address for the majority of its customers and cannot simply send them free handsets or free SIM cards, much less cause the customer to take the steps necessary to activate them.” About 74% of targeted customers have accepted offers for free phones or SIM cards -- or changed carriers -- but remaining customers haven’t responded, it said: “There will always be a subset of customers who will never respond no matter how frequently they are contacted and regardless of what they are offered.”
The CPUC’s deadline conflicts with an FCC condition that the carrier keep serving customers on non-Verizon networks for at least three years unless the customer opts to migrate, added Verizon: That's confusing and could cause administrative problems. "Without modification, a customer who opts out of the migration will not actually stop receiving service on their current non-Verizon network” until Nov. 23, 2024, due to the FCC requirement, it said. And it could put Verizon "in an unfair position of being forced to choose between disconnecting customers who do not migrate or opt out in violation of the FCC’s order or being faced with potential daily fines from” California, it said.